In America, credit is everything. Without it, a lot of people wouldn’t have the possessions that they do.

Not only that, but the impact of your credit history is such that failing to exercise responsible debt management habits — thus harming your credit scores — can cost you substantial money.

Here are five ways that having a good credit score can be beneficial to your wallet:

1. Cheaper financing

This one is a no-brainer, but the lowest interest rates typically go to those with the best credit scores.

Think about those financing offers you see on television for a brand-spanking-new car. Have you ever read the fine print? If not, take a moment to pay close attention to the bottom of the screen. Not every buyer gets the great rates.

To illustrate, if you take out a 48-month auto loan for $17,000 at 3.9 percent, the total payout over the life of the loan will be $18,388. Assuming your credit score is a little lower and you are granted a rate of 6.9 percent, the total will increase to $19,502.

My personal favorite to demonstrate is the mortgage loan. Just a point or two can cost you thousands of dollars. For example, a $150,000 30-year, fixed-rate mortgage at 3.5 percent will cost you $242,483 over the life of the loan. Add two more percentage points to that figure, which is 5.5 percent, and you now have a payoff balance of $306,608.

2. Lower insurance premiums

Unless you live in a state that forbids this practice, such as California, Hawaii and Massachusetts, don’t be surprised if you spot an inquiry on your credit reports when you buy insurance. Many insurance companies, both auto and home, run soft credit checks when evaluating prospective customers.

And guess who gets the lower premiums. That’s right: Those with the higher credit scores, because insurance companies maintain there is a correlation between credit scores and policy claims.

A recent study by CarInsurance.com indicated that “drivers with credit scores over 750 save an average of $783 a year compared with a typical driver in the same age bracket with merely average scores.” The results were derived from an analysis of 42,809 auto insurance quotes.

3. Waived deposits

When I purchased my first home, I was delighted to find out that I didn’t have to pay a penny to turn on the lights, water or cable because my credit rating was excellent.

That saved me hundreds of dollars, and the timing couldn’t have been more convenient as the moving costs were already way more than I had anticipated.

The same applies to cellphone contracts. Even if you plan to purchase the phone outright to go with your new plan, the carrier may require you to put down a deposit if your credit score is low, just in case you decide to run up the monthly bill and vanish without a trace.

4. Improved job prospects

According to Credit.com, the states that ban the practice of credit screenings for potential employees are California, Colorado, Connecticut, Hawaii, Illinois, Maryland, Oregon, Nevada, Vermont and Washington.

If you reside outside of these states, your credit file is fair game for examination, although the employer must obtain your permission to conduct the screening.

5. Increased haggling power

If you are the ideal customer, power lies in your hands, and you have the ability to create a bit more wiggle room in the asking price of a car or some other big-ticket item versus the customer who is barely scraping by with an approval.

As you can see, it pays (literally) to have good credit. If your score needs a boost, check out these tips.

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